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Announcing the Wise Philanthropy YouTube Channel [A request for you to subscribe]

November 19th, 2020

Richard Marker

A REQUEST: Please subscribe.

The Institute for Wise Philanthropy has launched the Wise Philanthropy channel on YouTube. It is now live albeit still in the construction phase. Over time, we will be posting opinion vlogs, abbreviated and selected educational offerings on best practices, and interviews/discussions with others in the philanthropy world.

As we begin to populate the content on the channel, we invite you to subscribe. There is no cost or obligation, and the process is very straightforward [Simply go to YouTube and search for Wise Philanthropy; press the subscribe button]. This will allow us to formulate the most appropriate content going forward, and be responsive to your needs and interests. [ALERT: Please be aware that there are some other sites with very similar names. Ours is simply the Wise Philanthropy channel; for now, you can identify it easily by seeing the videos featuring Richard Marker.]

Among the pieces already in the works are:

– Why Advocacy is a Mandate, Not an Option, for USA Philanthropy

– The Big Lie[s] – Philanthropy’s Opportunity and Dilemma in the Post Election Moment

– A Multi-part Series on Personnel Practices and Cautions

– Strategic Plans are Passé; Scenario Planning is Yesterday’s News; What now?

– We are pivoting so fast that we’re dizzy; will the changes we are now seeing in philanthropy practice survive the pandemic?

and more….

As always, thanks for being colleagues and friends. We look forward to hearing from you.

#397 American Exceptionalism Dies On the Petard of Masks

November 4th, 2020

Richard Marker

It is sad and more than a bit embittering to be living through the end of any illusions of American exceptionalism.

I will leave it to the unwritten future to decide if American power and influence has already had a similar demise, but make no mistake, we are witnessing the same fate as every single empire in history. Every one of them ultimately failed, and most failed for very similar reasons: hubris and belief in their own uniqueness and exceptionalism.

As this is written, the results of this terrible, divisive, and cruel election season are not yet fully known. But the lessons are there no matter which candidate is ultimately the victor. That half of Americans have endorsed a candidacy and a term of office that has committed itself to deny civil liberties, and constitutionally guaranteed rights, and the integrity of the separation of powers, and basic human decency is loss enough. Never before has an administration been so hell-bent on destroying what is meant by Americanism.

This is not a romantic elegy to a perfect American past, one that never existed. Endemic racism, economic inequity, xenophobic tendencies, religious bigotries, and more are cancers within the body politic and infect the purity of that history. Political leaders have long manipulated the system for personal gain and political power. But for much of our history, there was at least a cosmetic belief in the integrity of the system – even when pushed to the edge. As far as I know, never has a POTUS so disregarded the system so boldly, have sycophants been willing to be so flagrant about their self-interest, or have such a large percentage of the populace been willing to avert their eyes when presented with demonstrated dishonesty – even to their own detriment.

Many others have written with far more expertise than I on the psychopathology of the fake presidency of the last 4 years, and of the millions of those who choose to follow him. This piece will focus on a different issue – the distortion of the American experiment.

Any who have taken seminars with me or attended conferences where I have spoken on the history of American philanthropy have heard me contrast the underlying concept of the US and most of the rest of the world. In the US, rights OF individuals are primary; in the Napoleonic concept of society, the responsibility TO citizens is primary. We see this in very stark terms when we explore why the US does not guarantee health care, etc., nor make higher education affordable. At the same time, as observers as early as de Tocqueville noted, the US evolved a system of voluntarism to provide what government didn’t or wouldn’t. In other words, the underlying ethos was not that Americans didn’t care about their fellow citizens, only how they would be cared for. [For the purpose of this essay, I will not offer an in-depth analysis of what works, what doesn’t work, and the limits of the capacity of each system. I am restricting my thoughts only to the underlying concepts.]

To say this again: most Americans historically understood that there was a tradeoff for individual liberties; that is voluntary compliance and civic participation. They implicitly understood the “compact” that one without the other is neither viable nor moral.

The change didn’t happen suddenly in 2016. It has been brewing for years. Robert Putnam’s “Bowling Alone” popularized what had already become a prevailing reality. Americans lived atomized existence, were expected to fend for themselves in saving for retirement after the end of defined benefit plans, and were further expected to go into debt to pay for the education credential increasingly required to sustain any middle class standard of living. As much as distorted tax policy created the unconscionable concentration of wealth, the fact that the middle class has to incur so much personal obligation essentially served to give them a competitive leg “down” in adulthood. Is it any wonder that middle class comparative standards of living have been declining for over a generation?

If the “society” – writ large – didn’t care enough, why should individuals care enough to support others. That doesn’t mean that no one was charitable or philanthropic or generous. It did mean that there was an erosion in the idea that government was on their side. And, after all, that is what people have heard since the time of Reagan. Politicians swore to cut taxes – as if taxes are an inherently bad thing – regardless of the costs to livelihoods and wellbeing. Let the private sector or the voluntary sector take care of people – and too bad for those who can’t make it.

It is no accident that Medicare is not understood by many people to be government insurance and Medicare itself goes to lengths to mask that it is. Nor is it an accident that some politicians feel that the lifetime contract with workers to guarantee social security is dispensable and violable. After all, who are all these citizens to feel “entitled”? [forgetting, of course, that we all pre-paid for those retirement funds with every paycheck for our entire working lives.]

I suspect that readers of my articles know all of this and I can rely on the short-hand examples to make the case. But it appears that the last shredding of universal commitment to an ethos of caring for others was the mask test. The politicization of the wearing of masks these past 8 months was unforgiveable, but that it resonated so broadly was the body blow to “the caring for others” part of the American compact.

The angry, hostile, bizarre, and destructive rejection of wearing masks under the notion of individual liberties can only be understood by the absolute rejection of any assumed responsibilities for any other. Our long-standing system of providing a culture of caring, albeit through voluntarism, dissipated into vigilantism – over the wearing of masks. Even something so evident, so lifesaving, so simple was too much for too many. No longer was personal responsibility the trade-off for personal liberty. Only that which served their own self-interest mattered.

It is probably true that the POTUS, who may or may not have been re-elected when you read this, intuited this. His entire life has been built around snubbing his nose at any responsibility for anyone except himself. That didn’t stop these last 4 years when he putatively had responsibility for almost 350 million Americans. If the POTUS could only care for himself, why, his followers reasoned, should they be different? Let the Republic and our future be damned.

Even if Biden is elected, and his policies and affect do begin to restore some sense of decency, we will have a very long way to go to reestablish the underlying compact that defined the American experiment: radical freedoms with assumed universal voluntarism. It is by no means clear to me how he or we will do that, but without that or some other profoundly transforming affirmative change in our current national ethos and public policy, we will simply continue our sad trek through the last paragraphs of the history of just the latest failed empire, the once worthy American Experiment.

OPAL Panel on Philanthropy Responses to COVID 19 [video]

November 1st, 2020

Richard Marker

https://drive.google.com/file/d/1XyHI7UYp8VLqWnfSjveT8RcQ-L6HN7YC/view?usp=sharing

OPAL Panel on Successful Philanthropic Partnerships [video]

November 1st, 2020

Richard Marker

https://drive.google.com/file/d/1Yy_DAQA1tIFgrah-pPsNSLkFeBgA5mJm/view?usp=sharing

#395 The Myth of Perpetuity

October 23rd, 2020

Richard Marker

Please note that much of this article alludes to U.S. foundation law. Laws regarding charitable and non charitable foundations differ extensively around the world. Nevertheless, the question of perpetuity applies broadly even if some of the specifics of this article are more limited.

Some years ago, a very prominent Wall Street financier and his wife, herself a very prominent philanthropists, gave a headline grabbing gift to a world-famous museum. The most famous gallery in that museum would henceforth bear their names.

At the time, the story was making the rounds that the museum promised this couple that the gallery would bear their name in perpetuity. The financier asked, “how long is perpetuity?” The museum replied, “75 years.” The couple accepted those terms.

I am not sure if the story is apocryphal, but I was acquainted with the couple and it certainly could have been true. Whether or not, though, it gives an important message about “perpetuity”, one that is worth revisiting at a time when foundation “perpetuity” is on the tables of the philanthropy world.

Before proceeding, it is worth noting that US law does not guarantee perpetuity for foundations. In the US, the law requires a 5% payout plus excise tax regardless of earnings. If the foundation earnings don’t reach that level and beyond, the corpus will shrink; if there are several consecutive years of lower earnings, the corpus will continue to shrink exponentially. If the law wanted to guarantee perpetuity, the law would adjust the spending rate to reflect earnings or at least C.O.L. It doesn’t.

Perpetuity, therefore, is an intention. And indeed, perpetuity is a very, very long time. In my own professional experience, the oldest continuing foundation I have advised was about 500 years old and struggling how or if to continue since all of its legally mandated conditions had long since become irrelevant or expired. Most foundations, even those that aspire to “perpetuity” are much, much younger than that. I wonder how many of them really believe that they will be around in 500 years.

A more accurate description, then, of these foundations is “open-ended with no pre-determined time limit.” The hope of the founder is that successor trustees will align spending, investments, and governance policies sufficiently well to keep it going to make an impact generations hence but history has shown that true immortality requires something more than a large bank account.

This adjustment of the concept is consequential in terms of foundation decision-making. Most of us have been in rooms when one or more trustees makes clear what they believe their role is to be “stewards” of the foundation resources to last for generations. If perpetuity is the defining variable, stewardship is a credible approach to their role, and their approach to the foundation’s philanthropy.

The problem with “stewardship” as the primary motivator of philanthropic decision -making is that it focuses more on the finances and less on what the money can do. This is not to dismiss the authenticity of respecting donor intent, i.e., honoring the legacy of the family and foundation founders, but, functionally, it often means taking the most restrictive approach to the resources. True, if properly conceived, a “perpetual” foundation can serve to keep family connections alive, to remember the impact of the founder, to exert influence in a particular place over time. However, in too many cases, the idea of “stewardship” is so engrained that it instinctively negates public benefit investment strategies, and it serves to diminish the willingness to take even prudent risks with philanthropic dollars.

The flip side of “stewardship” is not “spend-out” – we’ll come to that later. It is, rather, to start from a different mentality that focuses on the philanthropy and not the money, i.e., the mentality of what good can our philanthropic investments and grantmaking make during the time it is under our auspices. The challenges at any given moment, and certainly of any given generation, can never be fully anticipated, no matter how prescient one may be. Therefore, current trustees can feel fully empowered to makes decisions that may respect their legacy while being thoughtfully creative. This approach refuses to kick the hard decisions down the generational road but accepts them now. And it recognizes that each successor generation should feel similarly empowered.

Not long ago, I had the privilege of working with a family foundation the size of which was about to grow well into the upper 9 figures. The family knew that not long from that time, the responsibilities of succession would fall upon them. Yet they were a bit stymied because they couldn’t get the founders’ generation to articulate what they wanted their foundation to do and be. Finally, the widow of the founder made it very clear that she wanted them to be free to decide. After all, she said [here slightly paraphrased], “I could never have imagined what the world was going to be during my lifetime. How can I know what my grandchildren’s and great grandchildren’s world will be like? They have to be free to make their own decisions.”

This decision liberated those generations at the table and those not yet born to be empowered and not simply stewards of inherited wealth. There was no implied message of perpetuity, but there was also no time limit on how long the foundation should continue. The presumption was that subsequent generations need to be empowered to decide that question as well.

Let’s now come to the question of “spend-out” or “time limited” mandates. This is, of course, not a new discussion – Andrew Carnegie and Julius Rosenwald were two extraordinary and influential philanthropists who made quite different decisions. Various Carnegie endowments continue to this day; Rosenwald specified a terminus ad quem for his foundation Most of those who have established endowed foundation assumed that they were to last indefinitely. It is certainly true that most wealth advisors would recommend investment strategies consistent with those assumptions.

There are, though, two significant challenges to the idea of open-ended foundations. One is efficacy, the other ideology.

The efficacy argument is an easy one: if one wants to address a problem – whatever that may be – a dollar spent today is better than 5 cents. Why not throw as much as possible on an identifiable and presenting scientific or social or educational issue on the certainty that it will surely make more of a difference now and may even solve a problem. [e.g., the Diamond Foundation’s successful “all-in” on HIV-AIDS.] And, while no one can anticipate new challenges in the future, the more one can solve today, the more likely those unanticipated ones can be addressed effectively in their time.

The ideological one is quite different. It challenges the very nature of [mostly] tax free accumulation of wealth controlled by those who had nothing to do with the creation of that wealth. [For this article, I will table the much-needed conversation about the shocking transfer of wealth from the middle class to the very wealthy we now have in America. And I will also defer comments on “The Giving Pledge” to another time] A foundation that lasts for generations essentially transfers power from generation to generation, perpetuating a class and economic divide. Those who control perpetual/time-unlimited foundations can exercise that power without accountability for their decisions [other than that required by law]. Indeed, there is no requirement that the intended beneficiaries have any say in the decisions even though they are the ones most impacted. This conceptual challenge is not new but has become vivid and vital during the recent months as the USA has been forced to acknowledge our stark racial and economic divides.

Readers of this piece are well aware of some very welcome initiatives in our field to redress this. In prior articles, we have discussed the work of Participatory Budgeting, Trust Based Philanthropy, CEP, NCRP, and others and many other funders are struggling mightily with what all of this means for them. These initiatives try to readjust the power base, the decision making, and the accountability loop. But, with very few exceptions, these initiatives are agnostic about perpetuity.

A number of prominent foundations have made clear that they fully intend to spend-out their resources within a specified time. But it is not yet clear if those foundations are outliers or part of a new normal. [For the last few years, that is one of the most frequently asked questions when I give presentations on philanthropy trends to funders in the United States and around the world.] Some have already closed and much has been written about their decisions and their exit strategies. As one reads the motivations for doing so, there seem to be two motivations – the efficacy argument presented above, and the ability to make the decisions while still alive to do so.

I am happy to be proven wrong, but I have not seen any of the foundations choose to spend-out for the ideological reasons. One wonders, though, if that will change as an ever larger percentage of funders and philanthropists become self-reflective in the face of the challenges to inherited power, the recognition of endemic racism, and the moral repugnance to the unconscionable economic divide.

There surely is no one right answer to how long our funds should last, but I would urge all of us to drop the concept of “perpetuity” and replace it with “open-ended.” None of us lives forever – and until proven otherwise, neither does a foundation. What matters, in the end, and what makes a difference in how worthy our legacies, is not how long a foundation lives but how thoughtfully its resources are used.


The Institute for Wise Philanthropy has been educating and advising funders, philanthropists, families, and philanthropy associations around the world since 2002.

#394 Must Scale Be a Precondition for Sustainability? [Corrected]

October 13th, 2020

Richard Marker

This is a hardly a new question. [Long time readers may recall several previous articles raising similar questions: “Right Sizing…” Dec 2016; “Winning Small….” July 2018; et al.]

Most for-profit businesses rely on scale. Nonprofit business models struggle to achieve scale. Funders, deciding on the viability of their non-profit grantees, should ask the question. Is scale a precondition for long term sustainability? Should it be?

The issue is more poignant and pressing today than ever. The viability of many in the non-profit sector, the conceptual and capacity challenges to funders everywhere, the recognition that philanthropy can never be separated from public policy all converge to raise questions about whether the operative business models for non-profits of the last period of time can still be valid.

For the last couple of decades, the assumptions about non-profit viability has been heavily informed by b-school thinking. Funders of established organizations have pushed organizations to be less dependent on philanthropic giving and more on earned income as a measure of long-term viability. Start-ups are often rated by their likelihood of achieving disruptive scale.

Scale does matter: one needs look no further than the US embarrassment regarding COVID-19 testing. Literally millions of people have found it difficult to get tested – and when tested to get timely results. [Even though this is the political season, for this piece, I will exercise restraint in my opinions about why that is. I am sure any regular reader knows my feelings.] The inability to provide testing at scale has limited the ability of many in the USA to make safe and reasonable plans for their own behavior, and businesses, schools and communities have been handcuffed in knowing how or if to develop a new normal.

The same will be true when a genuine scientifically reliable vaccine or treatment becomes available. We will return to normal, whatever that will mean, only when they are available at scale.

Another example, about which the literature is overwhelming, is about food insecurity/hunger. In the USA, There is simply no functional alternative to SNAP funding to reach scale. [Perhaps a guaranteed income on which a family can really live would be an alternative but that requires major systemic re-thinking.] Food pantries, soup kitchens, and other local efforts are still indispensable, sadly, but none can systematically assure that the millions of families, children, undercompensated receive essential and basic sustenance.

We see this assumption in funders’ responses to innovation in both for-profit and not-for- profit sectors. On the for-profit side, a new idea doesn’t have to be as disruptive as an Uber or Lyft or Airbnb or any of the other disrupters to warrant initial or mezzanine funding; but to receive funding, it would have to have a credible business model which would bring it to self-sustainable scale in a reasonable time frame. There are capital markets at every stage of the process that make those risks viable, and there are even tax incentives to give those risks even a little extra push.

This is true on the social impact side of this as well. It is certainly acceptable and reasonable to achieve social good through for-profit investments. To take but one example: Once upon a time, support for solar energy fit neatly into the grantmaking side of a foundation’s portfolio, especially for a funder with a commitment to environmental sustainability. Today, such funding fits comfortably on the investment side since its financial viability and its positive impact are so clear to all but some recalcitrant deniers. [Full disclosure: we are personal investors in solar energy development projects both in the United States and Africa.]

It is far less easy on the not-for-profit side. Very, very few not-for-profits ever reach the stage where they can generate sufficient fees for service or endowment income to be fully self-sustaining without dependence on grants and charitable gifts. It is somewhat easy to get limited start up funds for an innovative project but the larger a new organization gets, the greater the dependence on more and larger gifts. There is a very limited identifiable capital market for mezzanine and second stage not-for-profit organizations. The problem is that all too often funders have drunk the venture capital or impact investing Kool-Aid. “Will you be the disrupter that addresses hunger or poverty or homelessness or illiteracy? [you know, the little things.] And if not those, will your new project be sufficiently compelling that it will reach the scale, scope, and sustainability justifying the aspirations of both funders and creators? It is a rare not-for-profit that can credibly claim that business model.

The last 6 months have challenged those assumptions of what success should mean. Organizations that had built their business model around fees-for -service or government reimbursables have suffered greatly. The higher the percentage of reliance on those income sources, the harder it has hit. Organizations that relied more heavily on traditional grants and contributions had more reliable income, even if more variable than in “typical” years.

Moreover, as funders have become more committed to responding to a radically changed reality, many of us have frontloaded our giving, reduced our reporting requirements, and eliminated our restrictions. [How permanent those changes remains an open question – but for another time.] Locally/placed based grantmaking has resurfaced as a high priority for many, especially to direct service organizations.

What is evident in these changes is that scale can no longer be the primary driver. Of course, there may well be organizations that can deliver more, better, faster, and more efficiently even on the local level, but that doesn’t guarantee that they can do so everywhere and to everyone. If there are racial inequities, food deserts, uneven economic prices to pay for the pandemic, efficiency only takes you so far. Community based organizations may know the needs of their communities, and especially of micro-communities, that larger, more efficient organizations don’t.

I would hope that this corrective represents a welcome rethinking regarding sustainability. There are circumstances when sustainability cannot ever be based on program generated or endowment income.

There are even circumstances when scale becomes a counterproductive criterion. Permit one very real example to suffice: When I was CEO of a foundation 20+ years ago, we were involved in numerous funding collaboratives. One was in support of a very wonderful innovative program for and by young adults. Its ambitions were aligned with its capacities; its commitment to quality a reflection of the thoughtfulness of the founders; and its success commensurate with both. One of the funding partners believed that this was such a wonderful model that it should be scaled up. They persuaded the rest of us to hire a consultant who specialized in this kind of non-profit scaling. Sure enough, you are not surprised to read that at the end of the consultant’s extensive analysis, they came back with a series of recommendations about how to bring this boutique organization to national scale. [I was on record as disagreeing, but was outvoted, and if one is in a collaborative funding arrangement, there are ground rules.] Shortly thereafter, a development staff was hired, a new executive was selected, and a national roll-out was initiated. A year later the organization went out of business.

What happened? When the organization was small, local, and controlled by those who were peers of the target market, it worked great. When those folks were essentially relegated to program staff but no longer making the big decisions, it didn’t. Why? Because once it attempted to reach scale, it became a competitor to much larger, much better capitalized organizations. The agility and responsiveness that made it successful on the local level became impossible to achieve on the national level. While I know that I am not giving readers too many details here, suffice it to say that it was a classic case of funder overreach and the idealization of scale as a goal. We were simply wrong, and a jewel of a program became worthless.

Let me return to where I began. Scale does matter in addressing systemic issues; in fact, it is a sine qua non. There are times when anything less is not enough. But implementation is almost always local. And how to implement often requires local knowledge that a big picture funder may not have. We don’t always solve our most pressing problems if we only look at financial sustainability, equate capacity with scale, or dismiss the value of local innovation. Our funding commitments must include the vulnerable, smaller, and local if we truly want to bring impact to all.


The Institute for Wise Philanthropy has been teaching and advising foundations, philanthropists, families, and philanthropy organizations around the United States and the world since 2002.

Partnerships and Collaborations

October 7th, 2020

Richard Marker

The annual update of the Institute for Wise Philanthropy‘s check list for effective funder partnerships and collaborations is now available by request. This has been our most requested practical “how to” for over 10 years. Contact us if you would like your copy.

This is a link to a presentation on collaborations at a recent OPAL conference:

https://drive.google.com/file/d/1Yy_DAQA1tIFgrah-pPsNSLkFeBgA5mJm/view?usp=sharing


The Institute for Wise Philanthropy has been teaching and advising philanthropists, foundations, families, and philanthropy associations around the United States and elsewhere in the world since 2002.

#393 Why Transparency and Conflict of Interest Matter so much in Philanthropy

October 6th, 2020

Richard Marker

Yes, I will get to the philanthropy part in a bit, but first….

On Friday morning, I awakened to the news that the POTUS and his wife both had tested positive for the Coronavirus. As many of you know, I am not among the great sleepers, so I learned this information at 4 am. At the time, in response to some social networking posts, I predicted that by noon on Friday, there would be a slew of conspiracy theories surrounding this announcement.

I was wrong. It didn’t take that long. In fact, by breakfast time, I had already begun to see skeptics on both sides. Some of the theories were so far-fetched that they could only come from truly skewered perceptions of the world – or perhaps Russia. But others were unlikely but almost credible. Was this a staged event? If so, what was the intended scenario?

The President’s own physician, as we all saw, didn’t help matters since his Saturday update was itself not credible, or lacking in enough detail to be considered so. What was not being said? The reported timeline was, on its surface, impossible. The answers to questions were evasive and filled with lacunae. And when it was made clear to the public that the POTUS had to approve all public statements about his own medical condition, those missing pieces and inconsistencies took on even greater weight. Why should these reports be any more true or reliable than the hundreds upon hundreds of distortions of fact and outright dishonesty that have characterized the entire period of this presidency?

Is it any wonder that skeptics and conspiracy theorists and cultists all believe that we don’t yet know the full story – or that they do know the full story but the rest of us don’t? [For the moment, assuming that he does have “the Virus”, we cannot yet know the full story since the disease needs time to play out – even in the most normal of courses.] When the absence of transparency is the norm, when obfuscation is the practice of choice, and when information becomes weaponized, even those who might start with a sympathetic benefit of the doubt find themselves “just wondering.” Even if one grants that what and how to share personal information in an unfolding medical situation is not always easy, especially in a politically charged moment, the history of the absence of transparency makes everyone a bit dubious.

Well, as I said above, this piece is about philanthropy, not politics. So…

Those of us on the giving side of philanthropy are challenged with similar decisions in our own work. Rarely are those decisions as internationally momentous or as existentially portentous as the information on the medical status of the POTUS, but they do matter. Our choices can sometimes mark the life or death of organizations; more often they do have a direct impact on their health and sustainability. Those funding decisions can shape the social, ethnic, artistic, or educational landscape in profound and defining ways. And while philanthropic dollars alone cannot [and should not] sustain the entire not-for-profit and public-benefit sector or any subset of it, our dollars do define it and influence it. A lot depends on us.

Credibility, therefore, matters. Our credibility matters a lot. Grant seekers want to know what the rules are. Is the process fair or rigged? Do you have to know someone? Can they tell the whole truth about their organization or must a rosier-than-thou picture be presented? They know that somehow a decision will be made that has an impact, and rarely do they know how.

Yes, the funding world is more than a bit inscrutable. Competitive grantmaking is filled with uncertainty for those who seek funds. Unless a grant is defined by entitlement [i.e., if you meet certain criteria, you are guaranteed funds], a very rare condition indeed, every submission is being measure against a series of criteria, some of which are pre-defined, others of which are subjective.

Having been inside lots of those funding rooms, I can attest to the subjective nature of many decisions. But not for the reasons you may think. Most funders and foundations really do want to make good decisions, informed decisions, constructive decisions. We are human so there is no denying that we bring some of our attitudes and assumptions to any decision, but even allowing for that there is a subjective uncertainty. The reason, of course, is that we fund the future. Even with the most evidence-based choice, the best one can do is acknowledge the odds and the risks. As a proof-text: How many funders who made decisions about what to fund at their December 2019 board meetings got it right about what would happen to their grantees in March 2020?

What we owe the not-for-profit/public benefit field is that they can trust the process and that the decisions aren’t phony. Grantees may be disappointed and wish that they knew why they weren’t chosen. It isn’t always easy to say – any of us who have been faced with large dockets know that sometimes there isn’t a good reason. A whole bunch of proposals may have equal merit, but one has to be selected. That doesn’t mean the ones not selected were less worthy or tragically flawed. Try to tell a disappointed almost grantee that there really wasn’t anything to learn, it was just someone else’s day. Even if true, it won’t make them sleep any better.

In order for the system to work, non-profits have a legitimate expectation to know what our process is, and to be able to look at our decisions and feel that we, the funders, have been true to that process.

But for that process to work, we as funders also need to rely on genuine information from nonprofits. It is not only that insufficient information or inappropriate hyperbole may distort our decisions, but it will make it that much harder to really understand what interventions and solutions will accomplish what we both want. Transparency must go both ways. As one who has been in the philanthropy field for a very long time I can certainly give examples of willful dishonesty by those who have received or desired to receive grants, but those examples represent a very small percentage of the field. For most, if there is an insufficiency of information, or a far too optimistic articulation of capacity, it is well-intended and based on an uncertainty how to tell their story.

The burden to make openness possible is on us as funders. We need to create the environment of trust and honesty. We need to make clear that we really do need to learn from those who actually do the work we think needs to be done, and we really do need to understand what challenges, financial and otherwise, might keep that from happening.

That is why transparency of our process is indispensable.

Which brings me to conflict of interest. This is one of the most misunderstood areas on the not-for-profit landscape. Conflict of interest is not the same as self-dealing or self-inurement. Those are illegal so that is that. But in this sector, conflict of interest is an ethical question. It acknowledges that in the real-world people have competing claims of loyalty. Some of those competing loyalties may be de minimus; others may be substantial. We must reveal those competing claims, and then our boards must make an a priori judgement about what circumstances would be problematic. Sitting on a board of a foundation and also of an organization that has applied for funds in a competitive process pretty much demands recusal, at least. Sitting on the board of a foundation and also a local agency that has received funding every year for 25 years may be ok. As funders we need to take the appropriate action so that there is no possible misperception about how those competing loyalties play out when the funding docket is on the table. Organizations asking for funds have a right to know that we are aware of and addressing those conflicts – before any funding decisions are made. That is how trust is built.

For those of us in the funding world, the months since March have been a wake-up call to us about how much of what we “normally” have done has been to meet our own interests, needs, and priorities as much about those who are asked to deliver on those priorities. The vast majority of us have always been well intentioned and thoughtful but we learned that too often we hadn’t been listening to the real vulnerabilities of our grantees and their communities. All too often our processes have been needlessly opaque and byzantine – far from transparent. All too often those who make the decisions are inadvertently myopic, having an unintended conflict of interest. There may be legitimate disagreements about who should sit on what boards and who should make which decisions, but transparency and directness in acknowledging them will go a long way to sustain the viability and efficacy of our sector… especially at a time when the world needs to have confidence in us.

These are not easy matters to address as those who have undergone reviews by CEP or NCRP or participated in Trust Based Philanthropy programs or in our classes in philanthro-ethics can attest. But meaningful transparency is a sine qua non for long term success in our field.

And, let’s be honest, it would go a long way in the larger political world as well.

….
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Interview with Beth Granger –

September 25th, 2020

Richard Marker

https://www.linkedin.com/posts/bethgranger_im-live-with-richard-marker-activity-6706954127156637696-G70T

#392 When You Stop Learning, You Stop Knowing

August 17th, 2020

Richard Marker

It has happened in the past; it happened three times in the last 2 weeks: I had registered for a number of on-line networking and educational seminars. When a couple of the other participants, and in one case, a presenter, saw that I was participating, they asked me [in “chat” as we do these things these days]: “Why are you on this? Shouldn’t you be speaking/teaching this?”

A decade or more ago, after I had been an educator and speaker about philanthropy for a few years, I started hearing these questions when I would attend conferences where I wasn’t a speaker, or regional association and affinity group meetings as a member and not as a presenter. It is not up to me to decide if I am or was a thought leader in our field, but it was evident that many others thought of me that way.

This is flattering, to be sure, and I daresay, perhaps immodestly, that they were correct – I could easily have been a presenter in the recent sessions alluded to above, and quite often in comparable settings a decade ago. But just because I could have doesn’t mean that I was wasting my time – or theirs. I learned a long time ago that the minute you think you know everything is the minute you start to become irrelevant.

Different people have different learning styles. Speakers and educators have different presentation styles. Vocabulary [and jargon] change over time. Context matters. Underlying agendas are fluid. Just because one knows something doesn’t mean that one knows all there is to know. Even if I could easily have been a presenter in all of the sessions alluded to above, that doesn’t mean I didn’t learn from each. I could pay attention to what other presenters emphasized, how they said what they did, what questions were posed in the “chat”. They made me consider whether their approach was more on target than mine would have been – or less. They made me consider whether some of my business model choices were on target, or seriously flawed.

Even more crucial than affect or style is the recognition that our field, any field, is constantly evolving. Sometimes those evolutions are simply “old wine in new bottles”, but other times there truly are transformative ideas that can profoundly impact one’s thinking. If one rests on one’s “expertise” laurels, it doesn’t take long for that expertise to become dated.

A good example that transcends the philanthropy world is social media. Many organizations originally thought that they would become au courante if they simply developed a website or had a Facebook page but made no other changes in the way they communicated or operated. The proverbial “old wine….” Others, though, recognized that social media is not simply a new marketing tool but a transformative mode of epistemology and human experience. We know now that some of that transformation has been very welcome and some of it quite destructive, but there is no doubt that our world is as different now as print media was to the masses 3 centuries ago.

Expertise, even when legitimately earned, can still be very limited. This is often true of those in the academic world. [I used to be one, so I am not exempt.] One example: Some of you may remember the short-lived L3C fad of some years ago. For those who don’t – it was a pre-B-Corps experiment, heralded as the solution to solving social challenges through a private sector structure. At the time, as part of the curriculum for a course I was teaching for “Advanced Funders”, I invited someone who was considered to have done the cutting-edge legal work on L3C’s to present. No doubt the presenter knew more about L3C’s than anyone – until the funders began to ask questions. What became clear was that this “expert” had NO contact or discussions with anyone who might implement them or include them in their philanthropic problem-solving strategy. I scratched my head wondering how this person could have written what was considered the definitive document without talking to anyone.

Expertise can also be deceptively insular. Examples of this abound in our world of funders. Those who have done very interesting work or developed suggestive new models are often asked to present at conferences and courses. Often [not always, of course] there is no doubt that the work is worth learning about, but the presenter has done so at only one foundation or organization. When asked to extrapolate how to apply it to other situations, perhaps where the resources were more limited or the intended scope was different, the presenter could only report what had been done in the single place. [You can tell, I hope, that I am being as general as possible to avoid naming names or giving identifiable examples. Suffice it to say that it is not a unique phenomenon.] This does not mean that the presenter did not have genuine expertise but the breadth to know how to apply it to other settings was lacking.

Let me be clear that it was not my inherent wisdom that has convinced me of the need to be a lifetime learner. Rather, I learned this being an educator of literally thousands of fellow funders in many countries for two decades – through our own Institute for Wise Philanthropy since 2002, at the now defunct NYU Academy for Funder Education, and at the prestigious high end UPenn Center for High Impact Philanthropy Funder Education program, has taught me that breadth without depth can be too shallow and depth without breadth can be too limiting. Parochialism is an easy trap and recognized unique expertise can be intoxicating. Both have their place in our ecosystem, and I fully respect those who make those choices. But, I have learned, not my choices.

So, the next time you see me on a Zoom seminar, or someday in the future sitting next to you in real physical space as a fellow attendee at a conference, know this: when you suggest that I could have been the chosen presenter, it will always flatter me, and you may well be correct. But that doesn’t mean that you and I are wasting our time. There is always more for us to learn, and I truly hope that I will never cease being a learner.

After all, the day one stops learning is the day one stops knowing.